Chesapeake Energy Corp. swung to a heavy loss in the first quarter as the U.S. shale driller took a $3.6 billion write-down on some properties amid tumbling oil and natural gas prices.
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Excluding the impairment and other special charges, profit came in above expectations.
Earlier this year, Chesapeake announced plans to reduce its rig operations to their lowest level since 2004 amid falling crude-oil and natural gas prices. It said it would reduce capital expenditures by 37%, and drop the number of rigs drilling for new oil and gas finds by about 38%.
Chesapeake has struggled to recover from years of aggressive spending as the land-grab approach the company pioneered for oil and gas drilling meant it spent more than its wells generated in profit. But under Doug Lawler, who joined as chief executive in June 2013, the company has been selling assets to pay down its debts.
In the latest quarter, average daily production rose 14% to 686,000 barrels of oil equivalent, adjusted for asset sales. On average, Chesapeake operated 54 rigs in the quarter, compared with 67 in the fourth quarter and 60 in the prior-year period.
Overall, for the quarter ended March 31, Chesapeake reported a loss of $3.78 billion, or $5.72 a share, compared with a prior-year profit of $374 million, or 54 cents a share.
Excluding the write-down and unrealized gains on oil and natural gas commodity derivatives, per-share earnings were 11 cents, down from 59 cents a share a year earlier.
Revenue fell 45.3% to $2.76 billion.
Analysts polled by Thomson Reuters had expected a per-share profit of four cents and revenue of $3.68 billion.
Capital spending grew 8.6% from a year ago to $1.49 billion.
Write to Chelsey Dulaney at Chelsey.Dulaney@wsj.com
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